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ADDRESSING THE NEED FOR CREATIVE TRANSFORMATION: SURVEY SUGGESTS FINANCIAL SERVICES ARE FAILING TO EMBRACE CREATIVITY

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  • Frustrations revealed as one in four marketing professionals in the financial services sector do not believe they work in a creative industry
  • Over three quarters of respondents said that their company’s attitudes to new creative content strategies had not changed in the last three years
  • Nearly a third of marketers believe that a lack of support from the boardroom is the main barrier to their effectiveness as a creative professional

dog_logo_blackFinancial services organisations are not embracing the creative change required to meet the needs of an increasingly digital and device driven marketplace, according to insight gathered by global digital agency, Dog.  A survey, conducted by 72Point, interviewed 200 marketing, advertising, and PR and specialist digital creative within the UK financial services sector. It revealed that only 1% of respondents thought the financial services industry saw creative content as very important to their business bottom line; suggesting that financial services firms do not value creative communications strategies as a requirement for commercial success.

David Cowan, managing director of The Financial Services Forum, commented: “This research is welcome and illuminating. While the industry has advanced significantly, financial services organisations are still not fully engaging with creative marketing strategies at group board level. This has created a disconnection of creative strategy and brand communication as an integrated business principal at a time when the digital landscape is redefining our industry. The challenge, backed up by Dog’s research, is for marketers to prove business impact and for CEOs to be more open to what creative solutions can do for their companies.”

Gerry McClusker

Gerry McClusker

Data gathered by Dog illustrates the challenges faced by the majority of financial services communications professionals in gaining top level buy in for strategies that harness the full potential of digital channels and more creative marketing methods. A scant 2% of respondents said that they had an excellent level of boardroom engagement when proposing and delivering new creative content strategies, with only 9% stating that their company had a forward thinking attitude towards the creative process.

As financial services organisations get to grips with the digital transformation of business, marketing and brand communications, the survey alludes to the widespread persistence of a ‘silo mentality’ and a lack of alignment of strategies. Over half of survey respondents viewed poor integration with other areas of the business as the biggest barrier to their effectiveness as a creative professional, whileonly 8% consider marketing and communications functions in their organisations to be well integrated and connected.

Dog has a strong heritage of working with financial service clients to deliver creative solutions that support evolving business, marketing and digital communications objectives. Working with a range of financial services organisations – from retail audience banking to institutional investor focused asset management firms – has provided Dog with a unique perspective on the challenges and opportunities marketers and creative professionals are presented with.

Gerry McCusker, Managing Director of Dog commented: “The survey makes for extremely interesting reading, laying bare some of the major issues affecting the financial services sector. With opportunities to engage target audiences with multichannel creative content growing at pace, it’s a shame that the majority of respondents do not believe that the financial services is a creative industry, and only 7% believe that their creative skills are being fully valued and utilised. Coupled with the documented lack of strategic collaboration across the business, this is definitely holding back an industry that has the potential to be truly creative and must leave marketers feeling frustrated.

“Creative marketing strategies – when aligned with the overarching business strategies – enable financial services organisations to connect with target audiences in meaningful ways to achieve defined business goals. In today’s digitally led world, every marketing strategy should be creative, and all marketing activity should support wider business strategies. While a number of organisations are successfully marketing products and brands in creative ways, it is certainly not the norm within the industry. The potential is huge, yet the financial services industry is lagging behind other sectors.

The results from Dog’s survey reveal a disconnection between strategising and activation of content strategies. Three in four FS creative professionals have either a plan in place to deliver new and innovative content but not executed it, or discussed but not committed to delivering a defined strategy.

“We’ve reached a very exciting moment in financial services marketing. Conversations are taking place, opportunities are being identified, and it is up to marketers to harness creativity, and use every tool and channel at their disposal to implement compelling marketing strategies that deliver tangible results. Similar to the digital transformation, it will take time for board rooms to fully engage with the creative transformation needed to engage target audiences, but with sustained innovation and measurable business impact, we’ll get there.”McCusker added.

With brand messaging becoming an increasingly important asset to financial services organisations, Dog is hosting an industry discussion later this month with selected industry peers and commentators. David Cowan will be chairing a debate that aims to discuss creativity and creative strategies, and explore the concept of creative transformation in enabling financial services to secure sustainable growth in a challenging marketplace. Following the discussion, Dog plans to produce a downloadable whitepaper designed to help marketers achieve creative results and ensure their creative content marketing strategies are fully integrated with business strategy.

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Finance

Analysis: Wealth managers frustrated over bitcoin, anxious for piece of the action

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Analysis: Wealth managers frustrated over bitcoin, anxious for piece of the action 1

By David Randall

NEW YORK (Reuters) – The rollercoster ride in bitcoin since the start of the year has not dampened wealth manager Jim Paulsen’s enthusiasm for the cryptocurrency.

Yet Paulsen, chief investment officer for Leuthold Group, which manages $1 billion, cannot own bitcoin in client portfolios due to regulatory constraints. This has left him on the sidelines watching the world’s most popular cyrptocurrency surge more than 900% since its March lows in volatile trading that also saw bitcoin lose more than 20% in the span of a few days.

“What I like about bitcoin is… its correlation to stocks and other assets is extraordinarily independent,” said Paulsen, who remains frustrated that he cannot own it for clients.

The promise of an asset class that behaves differently than stocks or bonds is leaving portfolio and wealth managers scrambling own cryptocurrencies if they can.

Many view bitcoin as a good inflation hedge. Nearly 20% of advisors are contemplating investing in cyryptocurrencies this year due to concerns about inflation, up from 6.3% in 2019, according to a report from Citi.

Still, a number of advisors say they are unable to own bitcoin for their clients until they can hold it in an exchange-traded fund or mutual fund that clears legal hurdles common for any investment.

Should that happen, institutional money could flow in and push the asset class higher, analysts said.

BlackRock Inc, the world’s largest asset manager, said on Jan. 21 it was adding bitcoin futures as eligible investments for certain funds. Fund experts expect other asset management firms to follow suit.

Yet the U.S. Securities and Exchange Commission does not yet recognize cryptocurrencies as a security like a stock or a bond, and has not ruled whether mutual funds can own them directly, said Robert Jenkins, global head of research at Refinitiv Lipper. So it remains unclear whether any mutual funds currently own bitcoin because they are not required to disclose it, he said.

In the United States, eight firms have tried without success since 2013 to create a bitcoin ETF, according to Todd Rosenbluth, director of ETF and mutual fund research at New York based CFRA.

The SEC did not respond to questions for this article.

Funds like the popular ARK Invest ETF line that have positions in bitcoin do it through shares of the Greyscale Bitcoin Trust, a publicly traded trust that holds a set number of bitcoin units and often trades at a premium to the value of its underlying portfolio.

Securities regulators in Canada approved the world’s first bitcoin ETF on Feb. 12, leading some investors to hope that U.S. regulators will shortly follow.

President Joe Biden’s nominee to head the SEC, Gary Gensler, spoke in broad terms about crytocurrencies in a confirmation hearing Tuesday, suggesting that the agency should provide more regulation on how it views the asset class. Some investors have taken his appointment as raising the likelihood that a bitcoin ETF will be approved for the U.S.

Gensler “seems more crypto-friendly than previous folks who had oversight,” said Viraj Patel, head of asset allocation at Fiduciary Trust International, who has not yet made investments in the asset class for clients but is waiting for a U.S.-based ETF. “We’re really looking at cryptocurrency through the lens of this could be gold 2.0,” said Patel.

Still, Rosenbluth said he was skeptical of a product being approved this year, saying there would be a high bar to clear tied to market manipulation and custody audit.

Even in the absence of an ETF, retail interest “remains strong with no signs of abating,” JP Morgan analysts wrote in a Feb 16 research note.

Overall, cyptocurrency funds and products that investors can buy direct brought in nearly $5.6 billion in assets in 2020, up more than 600% from the year before, according to asset manager CoinShares. Cryptocurrency funds have gathered $4.2 billion in flows for this year through March 1, Coinshares said.

“Not allowing the purchase of cyrpto is something that’s frustrating to many advisors, but it’s such a volatile asset that many investors end up doing it on their own,” said Jimmy Lee, chief executive of the Wealth Consulting Group.

(Reporting by David Randall; editing by Megan Davies, Ira Iosebashvili and David Gregorio)

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Finance

2020: the year mortgages went digital

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2020: the year mortgages went digital 2

By Francesca Carlesi, co-founder and CEO, Molo

It’s safe to say that the past year has changed everything. With restrictions in place that limited almost every aspect of our lives, from work to socialising, it’s no surprise that some industries were decimated and others were left severely shaken. The mortgage sector was no exception, as it also underwent a vast transformation which may have changed the course of mortgages forever.

The industry saw a paradigm shift, which was driven by consumers being forced online. This was the case for everything from mortgage applications to online house viewings and property valuations. As expected, this resulted in an increased demand for digital mortgage solutions with more flexibility.

While the industry was already slowly shifting, the pandemic has accelerated this and now the traditional process of getting a mortgage is increasingly coming under threat. We’ve seen a number of somewhat surprising trends over the last year that support this argument and suggest that consumers are embracing the change. For example, compared to March last year, we’ve seen the number of people aged over 45 applying for a mortgage loan increase by 70%. This indicates that consumers who may have previously resisted applying for a digital mortgage saw no alternative option in lockdown.

It seems that this paid off, as our data suggests that overall consumers were more satisfied with the simpler and quicker process.

A shift in behaviour

It’s clear that the pandemic did nothing to discourage those seeking a mortgage from doing so and the industry continued to grow. For example, in October last year, the UK mortgage industry saw a 13-year high, where over 97,500 loans were approved – the highest figure since September 2007, the month at the start of the financial crisis. But what led to this and why?

In a post-pandemic world of financial uncertainty and instability, the idea of purchasing property is now being perceived by many as a safer bet than investing in the stock market or other investment options.

As a result, buy-to-let properties are becoming an increasingly appealing option and Google has now coined it as ‘breaking out’. Not only did Google trends observe a 5000% increase in the search term ‘how to get a buy-to-let mortgage’ last year, but at Molo, our own data also supported this and found a significant rise in the number of first-time buyers who were mortgage hunting.

Despite being introduced twenty years prior to buy-to-let mortgages, let-to-buy mortgages also saw huge growth in 2020. The pandemic has led to increased numbers of remote workers and commuting has become a thing of the past. UK cities are seeing somewhat of a mass exodus as the priorities of city dwellers are changing and many are going in search of more space. Let-to-buy mortgages offer the flexibility to facilitate this. Investing in this kind of mortgage means that families, for example, can afford to rent out their property in the city and move to locations that are more rural.

We’ve also seen the industry pivot slightly in terms of regional demands. While there is continued demand from London and the South East, for example, we’ve also seen growth in areas such as the North West and we predict this won’t slow any time soon. One of the cities with especially high demand was Blackpool, where growth in demand was twice the national average.

Future gazing: 2021 and beyond

We’re expecting that the changes seen across the industry over the past will stick. After all, if even the sceptical customers were happy with the ease and simplicity of the online mortgage application and approval process, why on earth would they go back?

It’s important that we learn from these observations and use them to draw insight into the future of the mortgage sector. For instance, while Coronavirus has certainly caused disruption for lenders and consumers alike, it’s also highlighted the need for a more advanced, digital offering. It’s shown that digital mortgages really have become the best option for customers. The pandemic has been a test run for businesses and has proved that, even after restrictions are lifted, there is no good reason for mortgage providers to return to the traditional but slower business-as-usual.

At least in the property world, 2020 could well be remembered as the year that mortgages went digital. While it’s true that the pandemic was the catalyst for this shift, it’s now gone beyond the virus. The changes we’ve seen over the past year are likely to shape the mortgage industry for years to come.

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EU finance chief says UK’s Northern Ireland move a breach of trust

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EU finance chief says UK's Northern Ireland move a breach of trust 3

DUBLIN (Reuters) – The European Union’s finance chief said Britain’s decision to make unilateral changes to Northern Irish Brexit arrangements raised questions over whether it can be trusted in future trade negotiations with any partner.

“It does open a question mark about global Britain, if this is how global Britain will negotiate with other partners. Our experience has been not an easy one to put it mildly,” Mairead McGuinness, who is negotiating post-Brexit financial services terms with Britain, told Irish broadcaster RTE on Thursday.

“We have to be very clear that when something happens that is not appropriate and indeed in our view breaches both trust and an international agreement, then we have to call it out. It wasn’t a good day yesterday but this morning we have to work for practical solutions, with the UK, not separately.”

(Reporting by Padraic Halpin; editing by John Stonestreet)

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